A bipartisan group of senators have co-sponsored a measure to extend the Terrorism Risk Insurance Act (“TRIA”) for the next seven years. TRIA, which is set to expire at the end of 2014, was put into place after the terrorist attacks on September 11, 2001. It essentially works as a backstop for the private market and ensures the availability of terrorism insurance policies by requiring the government to help cover a portion of the insured losses from a terrorist attack. The bill would increase the losses insurers must cover by $10 billion to $37.5 billion. Additionally, the bill would increase the percentage insurers would have to pay for certain losses to 20% from 15%. This increase would be phased in over five years.
Competing bills extending TRIA for five and 10 years have already been introduced in the House.
The bill, which is co-sponsored by U.S. Sens. Charles Schumer (D-N.Y.), Dean Heller (R-Neb.), Mark Kirk (R-Ill.) and Mike Johanns (R-Neb.), is expected to be introduced as early as next week.